3 Things an Apple TV Service Should Have to Succeed

With Apple reportedly hitting the pause button on its much-rumored streaming Apple TV service, many of us are wondering what's taking the company so long. But an even better question is, "What does Apple need to do to make it a success when it does arrive?"

Rumors about an Internet-based Apple TV service have been around since last March, when the Wall Street Journal first broke the news about Apple's plans. As we've previously reported, Apple was initially looking to offer about 25 local and cable cannels for $30 to $40 per month. According to Bloomberg, which cited an unnamed source, Apple more recently was preparing a package of 14 or so channels for the same $30 to $40 a month, but it couldn't convince broadcasters and networks to lower their prices enough for Apple to hit its monthly pricing goals.

It appears, though, that Apple isn't completely throwing in the towel. At a recent business conference, CBS's top executive, CEO Les Moonves, reportedly said he believes that Apple will eventually be able to put together a package of content that works for both content companies and consumers. It will just happen later rather than sooner.

Here are a few things we think Apple needs to do to make an Apple TV service a success.

1. Include Local Broadcasts

While securing all the content it needs to launch a viable service is clearly a challenge for Apple, it's not an insurmountable one, as Dish's Sling TV plan and some other services mentioned below have shown. But few of these new services include local channels in most major markets.

In fact, finding a way to include local broadcasts as part of its streaming TV package may be Apple's most formidable obstacle. One big stumbling block is that local affiliate deals are typically negotiated individually, which can be a time-consuming and unwieldy process. Instead, Apple is reportedly trying to simplify the process by convincing the major national broadcasters—ABC, CBS, NBC, and Fox—to negotiate with their respective local affiliates on Apple's behalf. This would enable Apple to offer local broadcasts on a national basis without all the complicated separate negotiations. It's not clear if Apple will be successful with this approach.

2. Launch a New Apple TV Box

Yes, we know—Apple just introduced a new settop box. While the fourth-generation player does include Siri voice, a new remote control, and an app store that's now open to third-party developers, we think it's missing two important elements: 4K video support, and better integration with Apple's HomeKit home-control system.

Given that the TV world is rapidly moving to a 4K future, support for higher-resolution UHD streams is a no-brainer, especially considering that Apple TV's key streaming competitors—Amazon Fire TV and the Roku 4—now offer this feature.

We were also surprised to see that the newest player didn't support Apple's Remote app, which lets you use your iPhone keyboard to enter text. The new Apple TV, at least at the time of our testing, also didn't let you connect a Bluetooth keyboard. And the new horizontal layout of the alphabetical keyboard makes inputting text incredibly tedious.

There are already rumors that Apple is working on an even newer Apple TV that could be introduced as early as the first quarter of 2016. If so, it's likely it will include one or more of these features, along with a faster processor.

3. Provide Better Integration with HomeKit

Better support for HomeKit—Apple's vision of an iOS-based home-control system that lets smart devices within the home understand and work with each other—may not be as obvious. But when the most recent Apple TV player launched, we were expecting to hear more about it becoming a gateway device within the home.

In fact, Apple TV already can be used with HomeKit-enabled devices, but you can’t give HomeKit commands to Siri on the Apple TV. It's possible that this can be addressed via firmware updates, but it's also probable that if Apple does launch a new Apple TV player, it will include better HomeKit integration.

Shifting TV Landscape

Apple's streaming TV efforts come amid tectonic shifts in the TV-viewing landscape. Earlier this week, we reported that Amazon is now selling discounted Showtime and Starz subscriptions to its Prime members, and Google recently announced the launch of an ad-free $10-per-month YouTube Red subscription service.

With more people looking for alternatives, the market for streaming media players also continues to grow. A recent report from Parks Associates says 31 percent of U.S. broadband households own one of the devices, up from 27 percent at the start of 2015.